Fares won’t come down, say bus firms

Bus companies have ruled out cutting their fares despite the cost of crude oil having dropped by more than half recently.

In letters to North East Liberal Democrat MSP Alison McInnes, two bus operators confirmed that they will not cut their fares.

Ms McInnes said: “I am disappointed that bus passengers will not see the benefits of falling diesel and petrol prices for quite some time.

“The companies should be considering renegotiating their bulk buy contracts. Savings should be passed on as quickly as possible.”

Stagecoach chief executive Martin Griffiths said that fuel represents only 11% of their total operating costs and there are many other factors which have an influence on fares levels. He said: “Nearly all our fuel requirement in the current 2014-15 financial year is already fixed at a level which is significantly higher than the current market price, which has dropped considerably in recent months.

“That means we get virtually no benefit from recent falls in the price of oil.

“Furthermore, some 90% of our fuel requirement for 2015-16 is already fixed.”

Meanwhile National Express Dundee gave a similar response. Managing director Elsie Turbyne said: “We are bound in respect of fuel prices by contracts, negotiated and agreed in advance.

“Large groups such as National Express and other passenger transport companies enter into contracts with fuel suppliers many months in advance and prices for bulk purchases are set at that time.”

First Group - which operates within Aberdeen – has already said it has no plans for fare cuts. First said its hedging policy meant it was committed to buying fuel at higher prices until next year.